Health Care Reform Promises Coverage for All With Diabetes

The historic health care reform legislation that President Barack Obama signed into law today will offer much greater security for people with diabetes.

"With the passage of health reform, 'just because you have diabetes' will no longer be a lawful excuse to deny coverage, to charge exorbitant rates, or to take away care just when a person with diabetes needs it most," said Nash Childs, PE, Chair of the Board of the American Diabetes Association, in a press release issued after the House of Representatives passed a Senate-approved reform bill Sunday night on a 219-to-212 vote. "It gives all Americans with diabetes a fighting chance at controlling this devastating disease before they face blindness, amputation, heart disease, and kidney failure."

Under the $940 billion reform legislation, which includes a package of final changes approved by Congress, insurance companies may no longer deny coverage to people with preexisting conditions like diabetes. The law will require that most Americans obtain health insurance coverage or face fines, resulting in 32 million more people who will ultimately be insured. The legislation also eliminates lifetime caps on benefits, requires large employers to provide workers with insurance, covers young adults up to age 26 on a parent's policy, subsidizes low- and moderate-income people, and supports preventive health care.

Some health care reform measures will go into effect quickly while others will be rolled out by 2014. Here is a breakdown of the major changes.

Provisions to take effect within a year

· Through a new program of high-risk insurance pools, people who have been denied coverage on the basis of preexisting conditions and have been uninsured for at least six months will be extended subsidized coverage until a system of health insurance exchanges is rolled out in 2014.

· Lifetime or annual caps on benefits will be eliminated. This is of special importance to people with diabetes, who spend more than twice as much on health care as people who don't have diabetes.

· Children may not be denied coverage on the basis of preexisting conditions. Insurance providers may not rescind coverage for people who are diagnosed with an illness.

· Family insurance plans will extend coverage to dependents up to age 26, helping families and young adults who are in college or out of work. Small-business tax credits will be available to employers that purchase insurance for their workers.

· All new insurance plans will be required to pay for preventive care. This is expected to help curb the increase in type 2 diabetes (57 million Americans have pre-diabetes), thereby reducing health care costs. Currently, about $112 billion a year is spent in the United States on diabetes treatment.

· Seniors who have fallen into the "doughnut hole" of Medicare Part D prescription coverage in 2010 will receive $250 to help pay for prescriptions. Starting in 2011, they will receive a 50 percent discount on brand-name drugs. The legislation aims to completely close the doughnut hole and provide 75 percent discounts on brand-name and generic drugs by 2020.

· Government spending on Medicare Advantage—the private-plan part of Medicare—will be frozen in 2011 and reduced in 2012.

Provisions to roll out later (generally by 2014)

· People with preexisting conditions may no longer be denied coverage under any policy.

· Almost all Americans will be required to have health insurance, or face an initial penalty in 2014 of $95 or 1 percent of income, whichever is greater. By 2016, the penalty will be $695 or 2.5 percent of income.

· State-run health insurance exchanges will provide a competitive marketplace for people to buy private insurance. The exchanges aim to provide affordable coverage for the self-employed, unemployed, and others not covered through their employer. The policies sold through these programs would be required to cover a range of benefits including preventive tests, hospitalizations, maternity care, and prescription drugs.

· Caps on insurance premiums will be set based on a percentage of income, ranging from 2 to 9.5 percent.

· Medicaid will be expanded to cover people with incomes of up to 133 percent of the poverty level—$29,327 now for a family of four.

· Individuals and families who cannot afford insurance through the state-run marketplaces but may not qualify for Medicaid will be eligible for premium subsidies as well as a limit on out-of-pocket health expenses.

· Companies employing more than 50 people that do not purchase health insurance coverage for employees will be fined.

· People with high incomes (at least $200,000 a year for individuals and $250,000 for married couples) would pay higher Medicare payroll taxes, as well as a 3.8 percent Medicare tax on investment income, beginning in 2013.

· Insurers providing "Cadillac" health insurance plans—those valued at more than $8,500 for individuals and $23,000 for families—will also be taxed.

People with diabetes who have been shut out of health insurance plans altogether, as well as those who have struggled with the high cost of prescription medications, will most likely be among the first to reap benefits of this legislation.

"Today is a day for celebration for the 23.6 million American children and adults who are living with diabetes," Childs said. "The passage of health reform by the House of Representatives finally tears down the wall that keeps people with diabetes from the health care they need."